Louisiana Health Service & Indemnity Company v. State of Louisiana, the State of Louisiana through the Department of Insurance, and James J. Donelon in his capacity as Commissioner of the Louisiana Department of Insurance

Louisiana Court of Appeal·Decided September 4, 2024·No. 2024CA0062·Unknown

Opinion

NOT DESIGNATED FOR PUBLICATION STATE OF LOUISIANA

FIRST CIRCUIT

2024 CA 0062

LOUISIANA HEALTH SERVICE & INDEMNITY COMPANY

VERSUS

STATE OF LOUISIANA, THE STATE OF LOUISIANA THROUGH THE DEPARTMENT OF INSURANCE, AND JAMES J. DONELON IN HIS CAPACITY AS COMMISSIONER OF THE LOUISIANA DEPARTMENT OF INSURANCE

Judgment Rendered:

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On Appeal from the

Nineteenth Judicial District Court In and for the Parish of East Baton Rouge State of Louisiana

No. C- 710, 187, Sec. 21

The Honorable Ronald R. Johnson, Judge Presiding v

Richard A. Sherburne Attorneys for Plaintiff/Appellant Jessica W. Chapman Louisiana Heath Service & Indemnity Douglas M. Chapoton Company d/ b/ a Blue Cross and Blue Erica S. Aguillard Shield of Louisiana Baton Rouge, Louisiana

Sonceree Smith Clark Attorney for Defendant/Appellee Baton Rouge, Louisiana The State of Louisiana through the Department of Insurance, and

Timothy Temple in his capacity as the Commissioner of the Louisiana Department of Insurance

BEFORE: WELCH, WOLFE, AND STROMBERG, JJ.

STROMBERG, J.

In this proceeding for judicial review of an administrative adjudication proceeding, the plaintiff, Louisiana Health Service & Indemnity Company, d/b/ a Blue Cross and Blue Shield of Louisiana ( Blue Cross), appeals a judgment of the district court that denied Blue Cross' petition for judicial review and affirmed the decision of the Division of Administrative Law ( DAL), which affirmed the

Louisiana Department of Insurance ( LDI) directive dated October 5, 2020. For the

following reasons, we affirm.

FACTS AND PROCEDURAL HISTORY

Blue Cross averred that the LDI issued an unlawful administrative directive'

concerning the rights of a " covered person" on October 5, 2020. The directive

stated, in pertinent part:

On July 29, 2019 [ Blue Cross] received the members['] [ first]

level appeal and [ Blue Cross] requested a patient authorization form signed. [ Blue Cross] received the signed patient authorization form on

9/ 5/ 2019. This authorization form included both first level and second level appeals. The [ first] level appeal was denied on 9/ 27/ 2019 and a letter was sent to the patient and [ the] provider. [ Blue Cross] received the [ second] level appeal request, in writing, on 11/ 19/ 2019. The provider did an action request on [ Blue Cross'] website on 1/ 14/ 2020, Blue Cross] responded that [ it] would not move forward with the appeal until a written authorization form was received from the member. On 2/ 5/ 2020[,] the provider sent another action request

stating that the requested [ form] was sent in the 7/ 29/ 2019 appeal[.]

Blue Cross] responded and stated [ it] would review. [ On] 2/ 19/ 2020, 2/ 26/ 2020[,] and 3/ 26/ 2020[,] [ the] provider sent action requests to Blue Cross] and [ the] appeal was still being reviewed on all dates.

The] 5/ 13/ 2020 action request made by [ the] provider ... [ was] now pending. [ On] 6/ 11/ 2020[,] another action request by [ the] provider was made.] [ Blue Cross] then denied [ it], stating that there was no authorization on file from the patient. [ The provider] verified with

Blue Cross] that [ it] had the authorization that was mailed in by the patient. The provider then faxed the authorization to [ Blue Cross] on and 8/ 31/ 2020 due to [ Blue Cross] stating 7/ 29/ 2020, 8/ 24/ 2020[,]

that it did not] have the authorization form when the [ provider]

inquired about the appeal. On 9/ 1/ 2020[,] [ Blue Cross] issued a denial due to [ the] [ un] timely filing of the request for the external review.

I We note that although the LDI argues that the October 5, 2020 letter was miscategorized as a directive by Blue Cross, this is not an issue assigned as error on appeal and therefore we pretermit discussion of this matter.

In review, the claimant satisfied the external review requirements set forth in La[.] R. S. 22[:] 2432- 2436, and in doing so, [ was] eligible for an external review.

Blue Cross contended that the directive was an attempt by the LDI to re-

write law under which a " covered person" or an " authorized representative" can

seek an independent review by an independent review organization of an " adverse determination or final adverse determination" by a health insurer pursuant to the Health Insurance Issuer External Review Act, La. R.S. 22: 2431- 2445. Blue Cross maintained that the LDI' s administrative actions conflated " covered person" with

provider" and effectively and unlawfully *changed the law.

Blue Cross subsequently sought a judgment staying the October 5, 2020 LDI directive; declaring the October 5, 2020 LDI directive invalid, unlawful, and

unconstitutional and therefore void and unenforceable; and for all general and

equitable relief due under Louisiana law. On June 30, 2021, the DAL issued its

decision and order upholding the LDI' s directive. On July 30, 2021, Blue Cross filed a Petition for Judicial Review in the Nineteenth Judicial District Court to seek review of the DAL' s decision. In its petition, Blue Cross requested that the district

court immediately stay the efficacy and enforcement of the LDI directive dated October 5, 2020, and declare the directive as invalid, unlawful, and

unconstitutional and therefore void and unenforceable. Blue Cross further

requested that the district court reverse the June 30, 2021 DAL directive and order

upholding the October 5, 2020 LDI directive. In response, the LDI submitted the

entire record from the DAL, which included the parties' stipulation of facts filed

on June 1, 2021. The stipulation of facts stated the following:

1. Following the submission of a request for authorization for a specific medical procedure by the [ p] rovider of the [ c] overed p] erson on June 10, 2019, [ Blue Cross] denied the claim finding that the medical service sought was not medically necessary.

2. On July 29, 2019, the [ m] edical [ p] rovider initiated a first level appeal, seeking appeal of the June 10, 2019 denial of claim rendered by [ Blue Cross.]

3. Following the initiation of the first level appeal, [ Blue Cross]

requested the [ p] erson' s authorization to permit the c] overed [

p] rovider to act as their authorized representative.

4. On August 19, 2019, the [ c] overed [ p] erson executed a document allowing the [ p] rovider to act as the authorized representative for first level and second level appeals. This document was sent to Blue Cross] on or about September 5, 2019.

5. On September 27, 2019, [ Blue Cross] upheld the denial of the preauthorization request in the first level appeal filed by the [ p] rovider finding that the medical service sought was not medically necessary.

6. On November 19, 2019, the [ p] rovider sent a second level appeal request as described by the [ p] rovider, using [ Blue Cross'] Appeal Request Form, as to the September 27, 2019 denial of coverage based on the lack of medical necessity.

7. By correspondence dated November 20, 2019, [ Blue Cross]

forwarded [ Blue Cross'] external appeal notice and form to the c] overed [ p] erson.

8. A series of written communications occurred between the

p] rovider and [ Blue Cross] between January and February 2020 via [Blue Cross'] Action Request Response Portal.

9. On August 31, 2020, the [ p] rovider forwarded to [ Blue Cross']

Medical Appeals Department another [ Blue Cross] " Appeal Request Form" as to the September 27, 2019 denial.

10. On September 1, 2020, [ Blue Cross] denied the request for second level appeal stating that the appeal request was received untimely.

11. The [ p] rovider instituted an appeal to the Commissioner of Insurance for determination of eligibility for external review on September 29, 2020.

12. On October 5, 2020, ... [ the] LDI issued [ n] otice of [ the]

c] ommissioner' s [ d] ecision on appeal of [e] ligibility of [e] xternal fleview [ c] ase [ n] umber 20203024 finding that the request for second level appeal submitted on November 19, 2019 by the p] rovider to be eligible for external review.

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Louisiana Health Service & Indemnity Company v. State of Louisiana, the State of Louisiana through the Department of Insurance, and James J. Donelon in his capacity as Commissioner of the Louisiana Department of Insurance, (La. Ct. App. 2024).

Louisiana Health Service & Indemnity Company v. State of Louisiana, the State of Louisiana through the Department of Insurance, and James J. Donelon in his capacity as Commissioner of the Louisiana Department of Insurance (Louisiana Health Service & Indemnity Company v. State of Louisiana, the State of Louisiana through the Department of Insurance, and James J. Donelon in his capacity as Commissioner of the Louisiana Department of Insurance) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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